When you are acquiring a mining claim land package worth millions of dollars, an independent third party review may not seem necessary. In our experience, mining claim due diligence is one of the most valuable steps an exploration company can take. Verifying claim validity, land status, and mineral rights before you buy protects your capital, your project timeline, and your shareholders.
Here is why.
Land status in the western United States is complex, and it is not always clear who owns what, or where. Maps are often outdated, incorrectly surveyed, or show unclear boundaries. When a federal mining claim is staked and located, or a tenement is pegged and filed with the Bureau of Land Management (BLM), that does not mean it was properly staked and located. The BLM is a recording agency. It records claim documents, but those filings may not be adjudicated (reviewed for accuracy) until months, or even years, later.
In theory, and unfortunately in practice for some junior exploration firms, a seller can stake a handful of claims in an area with just enough geologic promise to be marketable, then sell the land package with no warranties and leave the buyer to sort out the legal standing of the ground. The seller walks away with cash, stock, or both, while the buyer inherits the liability. The consequences often show up in the press releases that follow:
Public company buys 100 mining claims for $$$$.
Great news, stock price rises.
Public company learns half of the purchased claims have issues and are no longer valid.
Bad news, and a difficult conversation with shareholders.
Neither outcome reflects well on the company or its leadership.
We understand that junior exploration companies depend on a steady news flow, and that keeping up with it can be challenging when the market is active. We ask only that you consider one commitment: do not announce an acquisition until the land has physically been staked, purchased, or otherwise secured. Announcing “we plan to buy or stake” invites anyone reading the news to go stake the ground first. We have seen this play out repeatedly, and it is entirely avoidable. Paying millions for land that could have been acquired for a fraction of the cost is a costly mistake.
At the end of the day, as your preferred service provider, we do not want you to waste your dollars. We understand the nature of this industry and the high risk that comes with it. We also know that some companies are more focused on the market than on the ground. Regardless of your strategy, it is our duty to provide factual, defensible, and reliable work at every stage of your program. We love mining, we love exploration, and we know how critical this industry is to modern civilization. We are Burgex, and we are here to solve the many challenges of mining.